Thank you for your interest

BMI View: The UK vote to leave the EU will weigh on France's economic growth over the next few quarters, which in turn will pose downside risks to our pharmaceutical and healthcare sector forecasts. Despite the large pharmaceutical market and highdrugspending per capita, which will continue to make Francea major global market for drugmakers, market expansion will only resume at a slow pace over the next few years, with return to marginal positive growth in 2017. In line with our view in recent quarters, the rate of investment growth in France's pharmaceutical sector has remained relatively subdued in H116, while this trend will likely continue over the coming quarters, in part due tosluggishlabour market reform.

Headline Expenditure Projections

Pharmaceuticals: EUR33.46bn (USD37.11bn) in 2015 to EUR33.34bn (USD35.68bn) in 2016; -0.3% in local currency terms and -3.9% in US dollar terms. Forecastbroadly in line withlast quarter.

Healthcare: EUR251.26bn (USD278.66bn) in 2015 to EUR257.25bn (USD275.26bn) in 2016; +2.4% in local currency terms and -1.2% in US dollar terms. Forecast reviseddownwardsfrom last quarter.

Headline Pharmaceuticals & Healthcare Forecasts (France 2014-2020)

2014

2015

2016f

2017f

2018f

2019f

2020f

f = BMI forecast. Source: WHO, National Sources, BMI

Pharmaceutical sales, USDbn

44.700

37.110

35.680

36.730

38.690

40.950

41.740

Pharmaceutical sales, % of GDP

1.58

1.53

1.50

1.46

1.43

1.40

1.38

Pharmaceutical sales, % of health expenditure

13.7

13.3

13.0

12.7

12.4

12.2

12.0

Health spending, USDbn

326.480

278.660

275.260

290.400

312.530

336.750

348.540

Risk/Reward Index

In Q416, France's Risk/Reward Index (RRI) score remains unchanged at 73.1 out of the maximum 100 points. France is ranked sixth in terms of market attractiveness to pharmaceutical investors out of the 15 markets in Western Europe covered by BMI's RRI matrix. France's score is boosted by the large multi-billion dollar drug market and large pensionable population, but dragged down by modest market expansion.

Latest Updates

In July 2016, Sanofi and Boehringer Ingelheim announced the signing of contracts to secure the strategic transaction initiated in December 2015 which consists of an exchange of Sanofi's animal health business and Boehringer Ingelheim's consumer healthcare business. The transaction is expected by year-end 2016.

Stellar Biotechnologies and Neovacs are to form Neostell, a simplified stock corporation headquartered in France that will carry out the business of the companies' joint venture (JV) to manufacture and sell conjugated therapeutic vaccines using Stellar's Keyhole Limpet Hemocyanin (KLH) in the niche market of systemic lupus.

Also in July, according to the timetable set by the law of modernisation of France's health system, Hospital Grouping by Territories (GHT), a new mode of cooperation and integration of public health services across a territory, were formally established throughout France.

In the same month, France's Minister of Health Marisol Touraine launched a national strategy under the concept of 'e-health 2020' that will seek to enable making appointments and payments online, simplifying procedures for patients, enhancing tele-monitoring and telemedicine and the use of Big Data in diagnosis, among other objectives.

Valneva announced that it has successfully generated a highly purified inactivated vaccine candidate against the Zika virus in July 2016, an early advantage in development that will give Valneva options for acquisition or partnership with a larger company.

BMI Economic View

France's fragile economic recovery will falter in 2017 on the back of weak UK demand and plummeting confidence levels domestically. French exporters and fixed investment will take the biggest hit.

BMI Political View

Following the Brexit vote, France's political landscape in the run-up to the presidential elections in April 2017 will become increasingly polarised, with parties on both the far left and right calling to change Paris' relations with Brussels.

The France Pharmaceuticals & Healthcare Report features BMI Research's forecasts for drugs and healthcare expenditure and imports and exports, focusing on the growth outlook for the prescription, OTC, patented drugs and generics market segments.

Key Benefits

Benchmark BMI's pharmaceutical and healthcare market forecasts for France, to test other views - a key input for successful budgeting and strategic business planning in the French pharmaceutical and healthcare market.

Target business opportunities and risks in the French pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in France.

Assess the activities, strategy and market position of your competitors using our company profiles (including SWOTs, KPIs and latest activity) and competitive landscape tables.

Coverage

BMI Industry View

An at-a-glance perspective on the latest regulatory developments, key forecast indicators and major corporate developments, covering the prescription, OTC and generics markets. The pharmaceuticals and healthcare SWOT outlines strategic factors that affect the basic assumptions underpinning BMI’s forecast analysis, and taken together with BMI’s political, economic and business environment SWOTs, it gives a complete overview of market climate.

BMI Industry Forecast Scenario

Industry forecasts to end-2019 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:

BMI’s Risk Reward Index provides investors (both national and multinational) looking for opportunities in the region with a clear country-comparative assessment of the market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Market Summary

A snapshot of key market characteristics, including total size of the pharmaceuticals and healthcare segments, growth drivers, leading therapeutic areas and the competitive landscape

Details of the industry regulatory framework and key legislation covering the licensing of new products/services, pricing and reimbursements, intellectual property, taxation and advertising, as well as analysis of the overall regulatory burden.

Competitive Landscape

The competitive landscape section provides comparative company analyses and index by USD sales and % share of total sales – for the total pharmaceutical sector, as well as the OTC, generics and distribution sub-sectors.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.